Business Directories

Egypt may buy wheat from Argentina

Cairo, August 17, 2010

Egypt may resume wheat imports from Argentina after a hiatus of several years to help compensate for Russia's ban on exports, Trade Minister Rachid Mohamed Rachid said on Tuesday.

A severe drought has sharply reduced grain production throughout the Black Sea region and prompted Russia, the region's top exporter, to ban grain shipments until at least the end of the year.

In an interview with Reuters, Rachid said Egypt still aimed to import 6 million tonnes of wheat in 2010-2011 and was well on the way to replacing all the Russian wheat it had agreed to buy before the ban.

Egypt is the world's largest wheat importer, and Russia was the supplier of choice in most of its foreign wheat tenders in the past year. Asked if Egypt was considering new origins for wheat beside the United States, France and Canada, Rachid told Reuters: 'There are seven or eight wheat suppliers globally. Argentina is one of them ...it's a big supplier.'

He said he had held talks with Argentine government and private sector officials two weeks ago during a visit to sign a free trade agreement with Mercosur countries.

'We're happy to see Argentina added to our list of suppliers,' he said, adding that imports could begin 'with the next crop'.

In the fiscal year to June 30, 2010, Egypt's main wheat buying agency GASC bought 5.53 million tonnes of US, French, Russian, German, Kazakh and Canadian wheat at international tenders.

Some 63 percent of its wheat came from the Black Sea region. 'We are serious about keeping our diversification of sources,' said Rachid. 'That's the way to do it.'

Rachid said Russia's government had agreed to examine ways to reschedule supplies from October 1 but would not be in a position to take any decision on shipments before then.

'Of course the ban is on until the end of December. But (Russia) made it clear that for us, after October 1, they will give us an assessment of what they could or could not do, because by that time they will have the best estimate of their production and quantities, which they don't have at the moment.'

Rachid said Egypt would allow more than one shipment port for its wheat suppliers 'if we feel that such change of conditions will make supply easier without posing risks.'

He said: 'We do not have at the moment any specific needs to change our regulations' regarding changing shipment terms for wheat traders. A decision on whether to allow wheat suppliers to use more than one shipment port would be implemented 'very soon, possibly starting with the next tender', he added. - Reuters